REPORT|NNP TO|TO THE|DT CONGRESS|NNP :|: AUTHORITY|NNP OF|IN THE|DT UNITED|NNP STATES|NNS POSTAL|NNP SERVICE|NNP TO|TO INTRODUCE|NNP NEW|JJ PRODUCTS|NNS AND|CC SERVICES|NNS AND|CC TO|TO ENTER|NNP INTO|NNP RATE|NNP AND|CC SERVICE|NNP AGREEMENTS|NNP WITH|IN INDIVIDUAL|NNP CUSTOMERS|NNP OR|NNP GROUPS|NNP OF|IN CUSTOMERS|NNP 

UNITED|NNP STATES|NNS OF|IN AMERICA|NNP POSTAL|NNP RATE|NNP COMMISSION|NNP 
February|NNP 11|CD ,|, 2002|CD POSTAL|NNP RATE|NNP COMMISSION|NNP Memorandum|NNP 
February|NNP 11|CD ,|, 2002|CD 
TO|TO :|: Senate|NNP Committee|NNP on|IN Appropriations|NNP House|NNP Committee|NNP on|IN Appropriations|NNP Senate|NNP Committee|NNP on|IN Governmental|NNP Affairs|NNPS House|NNP Committee|NNP on|IN Government|NNP Reform|NNP 
SUBJECT|NNP :|: Report|NNP to|TO the|DT Congress|NNP on|IN Authority|NNP of|IN the|DT United|NNP States|NNPS Postal|NNP Service|NNP to|TO Introduce|NNP Innovative|JJ Products|NNPS and|CC Services|NNPS and|CC to|TO Enter|VB into|IN Rate|NNP and|CC Service|NNP Agreements|NNP 

In|IN accordance|NN with|IN the|DT direction|NN of|IN the|DT Joint|NNP Committee|NNP of|IN Conference|NNP concerning|VBG the|DT 2002|CD appropriation|NN for|IN the|DT Postal|NNP Service|NNP ,|, the|DT Postal|NNP Rate|NNP Commission|NNP hereby|NN transmits|NNS its|PRP$ report|NN on|IN the|DT scope|NN of|IN existing|VBG authority|NN of|IN the|DT United|NNP States|NNPS Postal|NNP Service|NNP under|IN current|JJ postal|JJ laws|NNS and|CC regulations|NNS to|TO introduce|VB new|JJ products|NNS and|CC services|NNS and|CC to|TO enter|VB into|IN negotiated|VBN service|NN agreements|NNS with|IN individual|JJ customers|NNS or|CC groups|NNS of|IN customers|NNS .|. 

RESPECTFULLY|NNP SUBMITTED|NNP ,|, 
George|NNP A.|NN Omas|NNP ,|, Chairman|NNP 
Ruth|NNP Y.|NN Goldway|NNP ,|, Vice|NNP Chairman|NN 
Dana|NNP B.|NN Covington|NNP ,|, Sr|NNP .|. ,|, Commissioner|NNP 
REPORT|NNP TO|TO THE|DT CONGRESS|NNP :|: 
APPENDIX|NNP 
Postal|NNP Service|NNP Product|NNP Innovations|NNP and|CC Special-Purpose|NNP Mail|NNP Classification|NNP Changes|NNS Reviewed|NNP by|IN the|DT Postal|NNP Rate|NNP Commission|NNP Since|IN January|NNP 1|CD ,|, 2000|CD 
I.|NN SUMMARY|NNP This|DT report|NN provides|VBZ an|DT analysis|NN of|IN the|DT United|NNP States|NNPS Postal|NNP Service|NNP 's|POS current|JJ legal|JJ authority|NN to|TO :|: (|( 1|CD )|) introduce|VB and|CC provide|VB new|JJ products|NNS and|CC services|NNS ;|: and|CC (|( 2|CD )|) enter|VB into|IN negotiated|VBN service|NN agreements|NNS with|IN individual|JJ customers|NNS .|. 
This|DT report|NN also|RB includes|VBZ background|NN on|IN the|DT use|NN of|IN such|JJ authority|NN within|IN the|DT past|JJ two|CD years|NNS .|. 

The|DT Commission|NNP 's|POS analysis|NN of|IN existing|VBG postal|JJ law|NN yields|VBZ the|DT following|JJ conclusions|NNS :|: 

•|NN The|DT Postal|NNP Reorganization|NNP Act|NNP of|IN 1970|CD gives|VBZ the|DT United|NNP States|NNPS Postal|NNP Service|NNP a|DT clear|JJ mandate|NN to|TO innovate|VB by|IN developing|VBG effective|JJ and|CC efficient|JJ services|NNS adapted|VBN to|TO the|DT needs|NNS of|IN the|DT Nation|NNP 's|POS mail|NN users|NNS .|. 
•|NN The|DT mechanism|NN for|IN implementing|VBG innovations|NNS in|IN domestic|JJ mail|NN services|NNS is|VBZ the|DT joint|JJ authority|NN shared|VBN by|IN the|DT Postal|NNP Service|NNP and|CC the|DT Postal|NNP Rate|NNP Commission|NNP to|TO adopt|VB new|JJ mail|NN classifications|NNS under|IN 39|CD U.S.C.|NNP §|NN §|NN 3623|CD through|IN 3625|CD .|. 
•|NN The|DT Postal|NNP Rate|NNP Commission|NNP has|VBZ developed|VBN specialized|JJ procedural|JJ rules|NNS that|WDT provide|VBP for|IN expeditious|JJ consideration|NN of|IN proposed|VBN service|NN innovations|NNS in|IN a|DT manner|NN consistent|JJ with|IN the|DT due|JJ process|NN rights|NNS of|IN other|JJ interested|JJ persons|NNS .|. 
•|NN Negotiated|NNP Service|NNP Agreements|NNP (|( NSAs|NNP )|) or|CC "|'' niche|NN classifications|NNS "|'' are|VBP rate|NN and|CC service|NN adjustments|NNS arranged|VBN by|IN the|DT Postal|NNP Service|NNP and|CC potential|JJ users|NNS that|WDT are|VBP legally|RB permissible|JJ ,|, provided|VBN that|IN :|: 
❶|CD The|DT proposal|NN is|VBZ reviewed|VBN in|IN a|DT public|JJ proceeding|NN ,|, as|IN the|DT Reorganization|NNP Act|NNP requires|VBZ ;|: 

❷|CD The|DT agreed-upon|JJ rate|NN and|CC service|NN changes|NNS will|MD work|VB to|TO the|DT mutual|JJ benefit|NN of|IN mail|NN users|NNS and|CC the|DT postal|JJ system|NN as|IN a|DT whole|JJ ;|: and|CC 

❸|CD The|DT negotiated|VBN rate-and-service|JJ package|NN is|VBZ made|VBN available|JJ on|IN the|DT same|JJ terms|NNS to|TO other|JJ potential|JJ users|NNS willing|JJ to|TO meet|VB the|DT same|JJ conditions|NNS of|IN service|NN .|. 

II|NNP .|. BACKGROUND|NNP AND|CC SCOPE|NNP OF|IN ANALYSIS|NNP In|IN joint|JJ deliberations|NNS on|IN appropriations|NNS for|IN the|DT United|NNP States|NNPS Postal|NNP Service|NNP and|CC certain|JJ other|JJ agencies|NNS and|CC departments|NNS for|IN Fiscal|JJ Year|NN 2002|CD ,|, the|DT committee|NN of|IN conference|NN directed|VBD both|DT the|DT Postal|NNP Service|NNP and|CC the|DT Postal|NNP Rate|NNP Commission|NNP to|TO prepare|VB reports|NNS on|IN particular|JJ areas|NNS of|IN the|DT Postal|NNP Service|NNP 's|POS authority|NN under|IN existing|VBG law|NN .1|CD 
Specifically|RB ,|, the|DT conferees|NNS directed|VBN :|: 

…|NN both|DT the|DT United|NNP States|NNPS Postal|NNP Service|NNP and|CC the|DT Postal|NNP Rate|NNP Commission|NNP to|TO independently|RB report|VB ,|, 90|CD days|NNS after|IN enactment|NN of|IN this|DT Act|NNP ,|, on|IN the|DT scope|NN of|IN existing|VBG authority|NN of|IN the|DT US|NNP Postal|NNP Service|NNP ,|, under|IN title|NN 39|CD ,|, United|NNP States|NNPS Code|NNP ,|, and|CC title|NN 39|CD ,|, Code|NNP of|IN Federal|NNP Regulations|NNPS ,|, to|TO introduce|VB and|CC provide|VB new|JJ products|NNS and|CC services|NNS (|( including|VBG the|DT introduction|NN and|CC provision|NN of|IN new|JJ products|NNS and|CC service|NN on|IN an|DT experimental|JJ or|CC market|NN test|NN basis|NN )|) and|CC to|TO enter|VB into|IN negotiated|VBN service|NN agreements|NNS with|IN individual|JJ customers|NNS or|CC groups|NNS of|IN customers|NNS .|. 
Such|JJ reports|NNS shall|MD include|VB background|NN on|IN the|DT use|NN of|IN such|JJ authority|NN within|IN the|DT past|JJ 24|CD months|NNS and|CC shall|MD be|VB provided|VBN to|TO the|DT Committees|NNS on|IN Appropriations|NNP ,|, the|DT Senate|NNP Committee|NNP on|IN Governmental|NNP Affairs|NNP ,|, and|CC the|DT House|NNP Committee|NNP on|IN Government|NNP Reform|NNP .|. 

H.|NN R.|NN CONF|NNP .|. REP|NNP .|. NO|UH .|. 107|CD -|: 253|CD ,|, 107th|CD Cong|NNP .|. ,|, 1st|CD Sess|NNP .|. 59|CD (|( 2001|CD )|) .|. As|IN directed|VBN ,|, the|DT Commission|NNP submits|VBZ this|DT report|NN to|TO the|DT Senate|NNP and|CC House|NNP of|IN Representatives|NNPS Committees|NNS on|IN Appropriations|NNP ,|, the|DT Senate|NNP Committee|NNP on|IN Governmental|NNP Affairs|NNP ,|, and|CC the|DT House|NNP Committee|NNP on|IN Government|NNP Reform|NNP .|. 

The|DT report|NN is|VBZ presented|VBN in|IN three|CD sections|NNS .|. 
The|DT first|JJ outlines|VBZ the|DT Postal|NNP Service|NNP 's|POS current|JJ legal|JJ authority|NN to|TO introduce|VB new|JJ products|NNS and|CC services|NNS ,|, the|DT role|NN of|IN the|DT Postal|NNP Rate|NNP Commission|NNP in|IN that|DT process|NN ,|, and|CC the|DT procedural|JJ mechanisms|NNS available|JJ for|IN expedited|VBN approval|NN of|IN such|JJ innovations|NNS .|. 
The|DT second|JJ section|NN addresses|VBZ the|DT same|JJ topics|NNS in|IN connection|NN with|IN Negotiated|NNP Service|NNP Agreements|NNP (|( NSAs|NNP )|) ,|, so-called|JJ "|'' niche|NN classifications|NNS ,|, "|'' which|WDT are|VBP special|JJ service|NN and|CC rate|NN arrangements|NNS negotiated|VBN between|IN the|DT Postal|NNP Service|NNP and|CC a|DT particular|JJ mailer|NN or|CC groups|NNS of|IN mailers|NNS with|IN features|NNS tailored|VBN to|TO their|PRP$ use|NN of|IN the|DT postal|JJ system|NN .|. 
Finally|RB ,|, an|DT appendix|NN to|TO the|DT report|NN summarizes|NNS recent|JJ 

1|CD The|DT amended|JJ bill|NN produced|VBN by|IN the|DT conference|NN committee|NN was|VBD enacted|VBN as|IN Pub|NNP .|. L.|NN No.|NN 107|CD -|: 67|CD ,|, 115|CD Stat|NNP .|. 514|CD (|( 2001|CD )|) .|. 

Commission|NNP proceedings|NNS in|IN which|WDT the|DT Postal|NNP Service|NNP has|VBZ sought|VBN to|TO introduce|VB service|NN innovations-some|JJ of|IN them|PRP customized|VBN for|IN particular|JJ groups|NNS of|IN mailers-on|JJ an|DT expedited|JJ basis|NN .|. 

III|NNP .|. POSTAL|NNP SERVICE|NNP AUTHORITY|NNP TO|TO DEVELOP|NNP ,|, INTRODUCE|NNP AND|CC PROVIDE|NNP NEW|JJ PRODUCTS|NNS AND|CC SERVICES|NNS 
A.|NN Innovation|NNP under|IN the|DT Postal|NNP Reorganization|NNP Act|NNP While|IN pre-existing|JJ law|NN afforded|VBN limited|JJ opportunities|NNS for|IN postal|JJ innovation|NN ,|, 2|CD the|DT Postal|NNP Reorganization|NNP Act|NNP of|IN 1970|CD gave|VBD the|DT newly-created|JJ United|NNP States|NNPS Postal|NNP Service|NNP a|DT clear|JJ mandate|NN to|TO innovate|VB by|IN developing|VBG effective|JJ and|CC efficient|JJ services|NNS adapted|VBN to|TO the|DT needs|NNS of|IN the|DT Nation|NNP 's|POS mail|NN users|NNS .|. 
Section|NN 101|CD (|( a|DT )|) of|IN Title|NNP 39|CD establishes|VBZ the|DT Postal|NNP Service|NNP 's|POS paramount|JJ obligation|NN "|'' to|TO provide|VB postal|JJ services|NNS to|TO bind|NN the|DT Nation|NNP together|RB through|IN the|DT personal|JJ ,|, educational|JJ ,|, literary|JJ ,|, and|CC business|NN correspondence|NN of|IN the|DT people|NNS .|. "|'' 
The|DT same|JJ section|NN establishes|VBZ the|DT performance|NN criterion|NN that|IN the|DT Postal|NNP Service|NNP is|VBZ expected|VBN to|TO achieve|VB as|IN a|DT matter|NN of|IN postal|JJ policy|NN :|: "|'' It|PRP shall|MD provide|VB prompt|VB ,|, reliable|JJ ,|, and|CC efficient|JJ services|NNS to|TO patrons|NNS in|IN all|DT areas|NNS and|CC . . .|... all|DT communities|NNS .|. "|'' 
Similarly|RB ,|, §|NN 403|CD (|( a|DT )|) assigns|VBZ the|DT Postal|NNP Service|NNP the|DT duty|NN to|TO "|'' plan|NN ,|, develop|VB ,|, promote|VB ,|, and|CC provide|VB adequate|JJ and|CC efficient|JJ postal|JJ services|NNS at|IN fair|JJ and|CC reasonable|JJ rates|NNS and|CC fees|NNS .|. "|'' 
The|DT Act|NNP fosters|NNS service|NN innovation|NN by|IN assigning|VBG the|DT Postal|NNP Service|NNP responsibility|NN "|'' to|TO provide|VB types|NNS of|IN mail|NN service|NN to|TO meet|VB the|DT needs|NNS of|IN different|JJ categories|NNS of|IN mail|NN and|CC mail|NN users|NNS [|NN .|. ]|NN "|'' 39|CD 
U.S.C.|NNP §|NN 403|CD (|( b|SYM )|) (|( 2|CD )|) .|. 

The|DT Reorganization|NNP Act|NNP grants|VBZ the|DT Postal|NNP Service|NNP specific|JJ powers|NNS that|WDT serve|VBP as|IN the|DT operational|JJ tools|NNS of|IN service|NN innovation|NN .|. 
Section|NN 404|CD of|IN Title|NNP 39|CD grants|NNS the|DT Postal|NNP Service|NNP plenary|JJ authority|NN over|IN custody|NN of|IN the|DT mail|NN and|CC its|PRP$ movement|NN [|NN §|NN 404|CD (|( a|DT )|) (|( 1|CD )|) ]|NN ;|: over|IN the|DT deployment|NN of|IN post|NN offices|NNS ,|, other|JJ facilities|NNS ,|, and|CC equipment|NN [|NN §|NN 404|CD (|( a|DT )|) (|( 3|CD )|) ]|NN ;|: and|CC over|IN the|DT means|NNS by|IN which|WDT stamps|NNS and|CC other|JJ postage|NN are|VBP sold|VBN [|NN §|NN 404|CD (|( a|DT )|) (|( 4|CD )|) and|CC (|( 5|CD )|) ]|NN .|. 
The|DT same|JJ section|NN also|RB authorizes|VBZ the|DT Postal|NNP Service|NNP "|'' to|TO provide|VB ,|, establish|VB ,|, change|NN ,|, or|CC abolish|VB special|JJ nonpostal|NN or|CC similar|JJ services|NNS [|NN .|. ]|NN "|'' 39|CD U.S.C.|NNP §|NN 404|CD (|( a|DT )|) (|( 6|CD )|) .|. 

Conclusion|NNP :|: The|DT Postal|NNP Reorganization|NNP Act|NNP of|IN 1970|CD clearly|RB mandates|VBZ that|IN the|DT Postal|NNP Service|NNP innovate|VB by|IN developing|VBG effective|JJ and|CC efficient|JJ postal|JJ services|NNS adapted|VBN to|TO the|DT needs|NNS of|IN the|DT Nation|NNP 's|POS mail|NN users|NNS .|. 

2|CD Former|NNP 39|CD U.S.C.|NNP §|NN 504|CD (|( a|DT )|) authorized|VBD the|DT Postmaster|NNP General|NNP to|TO maintain|VB a|DT research|NN and|CC development|NN program|NN ,|, and|CC to|TO conduct|VB experiments|NNS to|TO enhance|VB the|DT operational|JJ efficiency|NN and|CC economy|NN of|IN the|DT postal|JJ system|NN .|. 

B.|NN Commission|NNP Review|NNP of|IN Proposed|NNP Changes|NNS in|IN Domestic|NNP Mail|NNP Classifications|NNP Prior|RB to|TO 1970|CD ,|, the|DT array|NN of|IN mail|NN services|NNS provided|VBN by|IN the|DT Post|NNP Office|NNP Department|NNP was|VBD codified|VBN as|IN part|NN of|IN Title|NNP 39.3|CD The|DT Reorganization|NNP Act|NNP replaced|VBD this|DT statutory|JJ codification|NN of|IN postal|JJ services|NNS with|IN an|DT administrative|JJ process|NN in|IN which|WDT the|DT Governors|NNS of|IN the|DT Postal|NNP Service|NNP establish|VB ,|, and|CC the|DT Postal|NNP Rate|NNP Commission|NNP reviews|NNS proposed|VBD changes|NNS in|IN ,|, the|DT terms|NNS and|CC conditions|NNS of|IN postal|JJ services|NNS ,|, which|WDT are|VBP compiled|VBN as|IN the|DT Domestic|NNP Mail|NNP Classification|NNP Schedule|NNP (|( or|CC "|'' DMCS|NNP "|'' )|) 
.4|CD 

Section|NN 3621|CD of|IN Title|NNP 39|CD provides|VBZ that|IN "|'' the|DT Governors|NNS are|VBP authorized|VBN to|TO establish|VB reasonable|JJ and|CC equitable|JJ classes|NNS of|IN mail|NN .
. .|... in|IN accordance|NN with|IN the|DT provisions|NNS of|IN this|DT chapter|NN .|. "|'' 
Section|NN 3623|CD (|( a|DT )|) directs|VBZ the|DT Postal|NNP Service|NNP to|TO file|VB a|DT request|NN with|IN the|DT Postal|NNP Rate|NNP Commission|NNP for|IN a|DT recommended|JJ decision|NN on|IN establishing|VBG a|DT mail|NN classification|NN schedule|NN within|IN two|CD years|NNS of|IN the|DT Reorganization|NNP Act|NNP 's|POS effective|JJ date|NN .|. 
The|DT Postal|NNP Service|NNP complied|VBD with|IN this|DT requirement|NN early|RB in|IN 1973|CD ,|, and|CC a|DT Domestic|NNP Mail|NNP Classification|NNP Schedule|NNP recommended|VBN by|IN the|DT Commission|NNP became|VBD effective|JJ on|IN July|NNP 6|CD ,|, 1976.5|CD 

Following|VBG establishment|NN of|IN this|DT initial|JJ mail|NN classification|NN schedule|NN ,|, §|NN 3623|CD (|( b|SYM )|) provides|VBZ that|IN the|DT Postal|NNP Service|NNP "|'' may|MD from|IN time|VB to|TO time|NN request|NN that|IN the|DT Commission|NNP submit|VB ,|, or|CC the|DT Commission|NNP may|MD submit|VB to|TO the|DT Governors|NNS on|IN its|PRP$ own|JJ initiative|NN ,|, a|DT recommended|JJ decision|NN on|IN changes|NNS in|IN the|DT mail|NN classification|NN schedule|NN .|. "|'' 
Deliberations|NNP on|IN proposed|VBN mail|NN classification|NN changes|NNS follow|VBP proceedings|NNS in|IN which|WDT an|DT opportunity|NN for|IN on|IN the|DT record|NN hearings|NNS is|VBZ afforded|VBN to|TO mail|VB users|NNS and|CC an|DT officer|NN of|IN the|DT Commission|NNP required|VBD to|TO represent|VB the|DT interests|NNS of|IN the|DT general|JJ public|NN .|. 
39|CD U.S.C.|NNP §|NN 3624|CD (|( a|DT )|) .|. 
The|DT Commission|NNP 's|POS procedural|JJ rules|NNS governing|VBG proposed|VBN changes|NNS in|IN the|DT mail|NN classification|NN schedule|NN are|VBP contained|VBN in|IN Subpart|NNP C|NNP of|IN title|NN 39|CD of|IN the|DT Code|NNP of|IN Federal|NNP Regulations|NNPS ,|, 39|CD 
C.F.R.|NN §|NN 3001.61|CD et|CC seq.|NN 

3|CD See|VB former|JJ Title|NNP 39|CD ,|, Part|NNP IV-Mail|NNP Matter|NNP .|. 

4|CD The|DT text|NN of|IN the|DT Domestic|NNP Mail|NNP Classification|NNP Schedule|NNP is|VBZ published|VBN as|IN Appendix|NNP A|DT to|TO Subpart|NNP C|NNP of|IN 39|CD C.F.R.|NN Part|NN 3001|CD ,|, following|VBG 39|CD C.F.R.|NN §|NN 3001.68|CD 

5|CD Docket|NNP No.|NN MC|NNP 73|CD -|: 1|CD ,|, Phase|NN I|PRP ,|, Opinion|NNP and|CC Recommended|NNP Decision|NNP ,|, April|NNP 15|CD ,|, 1976|CD ;|: accepted|VBD in|IN Decision|NNP of|IN the|DT Governors|NNS of|IN the|DT United|NNP States|NNPS Postal|NNP Service|NNP on|IN Establishing|VBG a|DT Mail|NNP Classification|NNP 
Schedule|NNP ,|, June|NNP 2|CD ,|, 1976|CD .|. 
Over|IN the|DT past|JJ 25|CD years|NNS ,|, the|DT Postal|NNP Service|NNP has|VBZ filed|VBN many|JJ such|JJ mail|NN classification|NN requests|NNS with|IN the|DT Commission|NNP ,|, seeking|VBG either|CC to|TO establish|VB new|JJ postal|JJ products|NNS or|CC to|TO reconfigure|NN pre-existing|JJ services|NNS .|. 
Less|RBR frequently|RB ,|, the|DT Commission|NNP has|VBZ begun|VBN proceedings|NNS on|IN its|PRP$ own|JJ initiative|NN ,|, most|RBS commonly|RB in|IN response|NN to|TO a|DT mail|NN user|NN 's|POS request|NN to|TO do|VB so|RB .|. 
Both|DT forms|NNS of|IN proceeding|VBG have|VBP proven|VBN to|TO offer|VB useful|JJ opportunities|NNS to|TO introduce|VB innovations|NNS in|IN postal|JJ services|NNS .|. 

Conclusion|NNP :|: The|DT joint|JJ authority|NN shared|VBN by|IN the|DT Postal|NNP Service|NNP and|CC the|DT Postal|NNP Rate|NNP Commission|NNP under|IN the|DT Reorganization|NNP Act|NNP to|TO adopt|VB new|JJ mail|NN classifications|NNS is|VBZ the|DT mechanism|NN for|IN implementing|VBG innovations|NNS in|IN domestic|JJ mail|NN service|NN .|. 

C.|NN Commission|NNP Procedures|NNP Adapted|VBN to|TO the|DT Expeditious|NNP Consideration|NNP of|IN Proposed|NNP Service|NNP Innovations|NNP 

Recognizing|NNP that|IN certain|JJ types|NNS of|IN proposed|VBN service|NN innovations|NNS merit|VBP consideration|NN under|IN specialized|JJ procedures|NNS ,|, the|DT Commission|NNP has|VBZ adopted|VBN several|JJ sets|NNS of|IN rules|NNS that|WDT are|VBP customized|VBN for|IN defined|VBN categories|NNS of|IN Postal|NNP Service|NNP requests|NNS .|. 
The|DT rules|NNS depart|VBP from|IN those|DT generally|RB applicable|JJ to|TO proposed|VBN mail|NN classification|NN changes|NNS by|IN reducing|VBG the|DT amount|NN of|IN supporting|VBG evidence|NN the|DT Postal|NNP Service|NNP is|VBZ required|VBN to|TO produce|VB ,|, and|CC by|IN expediting|VBG the|DT Commission|NNP 's|POS procedural|JJ schedule|NN for|IN considering|VBG the|DT particular|JJ form|NN of|IN proposed|VBN change|NN .|. 

The|DT Commission|NNP determined|VBD almost|RB twenty|CD years|NNS ago|RB that|IN there|EX was|VBD a|DT need|NN for|IN specialized|JJ rules|NNS to|TO facilitate|VB Postal|NNP Service|NNP mail|NN classification|NN requests|NNS involving|VBG proposed|VBN new|JJ services|NNS ,|, or|CC changes|NNS in|IN existing|VBG services|NNS ,|, that|WDT were|VBD intended|VBN to|TO serve|VB as|IN experiments|NNS .|. 
The|DT rules|NNS ,|, contained|VBD in|IN 39|CD C.F.R.|NN §|NN §|NN 3001.67|CD through|IN .67|CD d|SYM ,|, provide|VBP a|DT mechanism|NN for|IN limiting|VBG the|DT issues|NNS on|IN which|WDT a|DT trial-type|JJ hearing|NN is|VBZ required|VBN ;|: allow|VB the|DT Postal|NNP Service|NNP to|TO explain|VB the|DT unavailability|NN of|IN data|NNS that|WDT would|MD otherwise|RB have|VB to|TO be|VB filed|VBN ;|: and|CC provide|VB for|IN data|NNS collection|NN for|IN the|DT duration|NN of|IN the|DT experiment|NN .|. 
The|DT experimental|JJ rules|NNS also|RB incorporate|VB a|DT procedural|JJ time|NN limit|NN of|IN 150|CD days|NNS from|IN the|DT Commission|NNP 's|POS determination|NN that|IN the|DT proposed|JJ change|NN is|VBZ experimental|JJ in|IN nature|NN .|. 

These|DT rules|NNS were|VBD not|RB used|VBN extensively|RB .|. 
A|DT joint|JJ Postal|NNP Service-|NNP Postal|NNP Rate|NNP Commission|NNP task|NN force|NN suggested|VBD a|DT number|NN of|IN areas|NNS where|WRB additional|JJ special|JJ rules|NNS might|MD further|RB encourage|VB Postal|NNP Service|NNP innovation|NN .6|CD 
The|DT Postal|NNP Service|NNP petitioned|VBD the|DT Commission|NNP in|IN 1995|CD to|TO adopt|VB rules|NNS to|TO implement|VB some|DT of|IN the|DT task|NN force|NN 's|POS recommendations|NNS .|. 
The|DT Commission|NNP conducted|VBD a|DT rulemaking|VBG to|TO consider|VB the|DT rules|NNS proposed|VBN in|IN the|DT Service|NNP 's|POS petition|NN ,|, and|CC after|IN considering|VBG the|DT comments|NNS of|IN interested|JJ parties|NNS ,|, implemented|VBD four|CD of|IN the|DT proposed|JJ initiatives|NNS ,|, albeit|IN in|IN revised|VBN form|NN .|. 

Three|CD of|IN the|DT new|JJ sets|NNS of|IN rules|NNS prescribe|VBP expedited|VBN procedures|NNS for|IN particular|JJ categories|NNS of|IN Postal|NNP Service|NNP requests|NNS .|. 
The|DT fourth|RB set|VBN specifies|VBZ conditions|NNS under|IN which|WDT the|DT Service|NNP may|MD use|VB multi-year|JJ test|NN periods|NNS to|TO demonstrate|VB that|IN a|DT proposed|VBN new|JJ service|NN will|MD become|VB compensatory|JJ over|IN time|NN .|. 

The|DT first|JJ set|NN of|IN these|DT new|JJ procedural|JJ rules|NNS ,|, incorporated|VBN into|IN the|DT Commission|NNP 's|POS rules|NNS of|IN practice|NN as|IN sections|NNS 161|CD through|IN 166|CD ,|, 7|CD establish|VB expedited|VBN procedures|NNS for|IN consideration|NN of|IN Postal|NNP Service|NNP proposed|VBD market|NN tests|NNS of|IN potential|JJ new|JJ services|NNS .|. 
The|DT rules|NNS specify|VB the|DT limited|JJ information|NN the|DT Service|NNP is|VBZ required|VBN to|TO file|VB in|IN support|NN of|IN a|DT proposed|JJ market|NN test|NN ,|, including|VBG a|DT plan|NN for|IN testing|VBG the|DT proposed|VBN new|JJ service|NN and|CC associated|VBN data|NNS collection|NN and|CC reporting|VBG requirements|NNS .|. 
They|PRP also|RB streamline|VB public|JJ notice|NN and|CC hearing|NN procedures|NNS ,|, and|CC provide|VB for|IN issuance|NN of|IN a|DT "|'' yes|UH or|CC no|DT "|'' Commission|NNP decision|NN on|IN the|DT proposed|JJ market|NN test|NN within|IN 90|CD days|NNS ,|, consistent|JJ with|IN the|DT procedural|JJ due|JJ process|NN rights|NNS of|IN interested|JJ persons|NNS .|. 
The|DT Postal|NNP Service|NNP 's|POS innovative|JJ Mailing|NNP Online|NNP service|NN ,|, for|IN which|WDT a|DT three-year|JJ experimental|JJ trial|NN was|VBD requested|VBN and|CC approved|VBD in|IN Docket|NNP No.|NN MC|NNP 2000|CD -|: 2|CD ,|, was|VBD initially|RB considered|VBN and|CC recommended|VBN by|IN the|DT Commission|NNP under|IN the|DT market|NN test|NN rules|NNS .|. 
See|VB the|DT Appendix|NNP to|TO this|DT report|NN under|IN the|DT heading|VBG for|IN Docket|NNP No.|NN MC|NNP 2000|CD -|: 2|CD .|. 

The|DT second|RB set|NN of|IN rules|NNS ,|, 8|CD apply|VB to|TO Postal|NNP Service|NNP proposals|NNS to|TO implement|VB new|JJ services|NNS that|WDT would|MD supplement|VB ,|, but|CC not|RB alter|VB ,|, existing|VBG mail|NN classifications|NNS and|CC rates|NNS on|IN a|DT provisional|JJ basis|NN for|IN a|DT limited|JJ time|NN .|. 
As|IN in|IN the|DT market|NN test|NN rules|NNS ,|, the|DT provisional|JJ service|NN rules|NNS identify|VBP the|DT supporting|VBG information|NN to|TO be|VB provided|VBN by|IN the|DT Postal|NNP Service|NNP ;|: in|IN addition|NN ,|, they|PRP allow|VBP the|DT Service|NNP to|TO explain|VB why|WRB it|PRP should|MD not|RB be|VB required|VBN to|TO provide|VB 

6|CD See|VB Postal|NNP Ratemaking|NNP in|IN a|DT Time|NNP of|IN Change|NNP :|: A|DT Report|NNP by|IN the|DT Joint|NNP Task|NNP Force|NNP on|IN Postal|NNP Ratemaking|NNP ,|, June|NNP 1|CD ,|, 1992|CD .|. 

7|CD 39|CD C.F.R.|NN §|NN §|NN 3001.161|CD -|: .166|CD .|. 
8|CD 39|CD C.F.R.|NN §|NN §|NN 3001.171|CD -|: .176|CD .|. 
information|NN called|VBN for|IN in|IN the|DT Commission|NNP 's|POS general|JJ rules|NNS for|IN mail|NN classification|NN proposals|NNS .|. 
The|DT rules|NNS likewise|RB expedite|VB public|JJ notice|NN and|CC procedural|JJ scheduling|NN ,|, providing|VBG for|IN a|DT "|'' yes|UH or|CC no|DT "|'' Commission|NNP decision|NN within|IN 90|CD days|NNS ,|, consistent|JJ with|IN the|DT due|JJ process|NN rights|NNS of|IN other|JJ parties|NNS .|. 

A|DT third|JJ set|NN of|IN rules|NNS ,|, adopted|VBN as|IN sections|NNS 69|CD through|IN 69|CD c|SYM of|IN the|DT rules|NNS of|IN practice|NN ,|, 9|CD applies|VBZ to|TO Postal|NNP Service|NNP requests|NNS for|IN permanent|JJ mail|NN classification|NN changes|NNS that|WDT are|VBP minor|JJ in|IN character|NN .|. "|'' 
Minor|NNP "|'' classification|NN changes|NNS are|VBP defined|VBN as|IN those|DT that|WDT would|MD not|RB change|VB any|DT existing|VBG rate|NN or|CC fee|NN ;|: would|MD not|RB impose|VB any|DT new|JJ restriction|NN on|IN eligibility|NN for|IN mailing|NN ;|: and|CC would|MD not|RB significantly|RB increase|VB or|CC decrease|VB the|DT estimated|JJ contribution|NN of|IN the|DT affected|JJ mail|NN subclass|NNS or|CC service|NN category|NN to|TO the|DT institutional|JJ costs|NNS of|IN the|DT Postal|NNP Service|NNP .|. 
The|DT rules|NNS specify|VB limited|JJ required|VBN supporting|VBG information|NN ,|, allow|VBP the|DT Service|NNP to|TO explain|VB the|DT unavailability|NN of|IN otherwise|RB required|VBN data|NNS ,|, and|CC also|RB streamline|VB procedural|JJ scheduling|NN .|. 
Under|IN these|DT rules|NNS for|IN minor|JJ classification|NN proposals|NNS ,|, the|DT procedural|JJ deadline|NN for|IN rendering|VBG a|DT Commission|NNP decision|NN is|VBZ 90|CD days|NNS from|IN the|DT filing|NN of|IN the|DT Postal|NNP Service|NNP request|NN if|IN no|DT hearings|NNS are|VBP held|VBN ,|, and|CC 120|CD days|NNS if|IN hearings|NNS are|VBP scheduled|VBN in|IN the|DT case|NN .|. 

Finally|RB ,|, the|DT fourth|RB set|NN of|IN rules|NNS ,|, contained|VBD in|IN sections|NNS 181|CD and|CC 182|CD of|IN the|DT rules|NNS of|IN practice|NN ,|, 10|CD applies|VBZ to|TO Postal|NNP Service|NNP requests|NNS for|IN new|JJ services|NNS that|IN it|PRP believes|VBZ can|MD not|RB recover|VB all|DT their|PRP$ associated|JJ costs|NNS in|IN the|DT first|JJ full|JJ fiscal|JJ year|NN of|IN their|PRP$ operation|NN .|. 
In|IN such|JJ instances|NNS ,|, the|DT Service|NNP 's|POS request|NN must|MD be|VB supported|VBN by|IN testimony|NN of|IN a|DT Postal|NNP Service|NNP witness|NN that|WDT explains|VBZ the|DT rationale|NN for|IN the|DT proposed|VBN multi-year|JJ test|NN period|NN .|. 
The|DT request|NN should|MD also|RB provide|VB Return|NN on|IN Investment|NNP projections|NNS ,|, other|JJ available|JJ financial|JJ analyses|NNS ,|, and|CC cost|NN ,|, revenue|NN ,|, and|CC volume|NN estimates|NNS for|IN the|DT new|JJ service|NN for|IN the|DT entire|JJ proposed|VBN test|NN period|NN .|. 
The|DT rules|NNS establish|VB a|DT policy|NN standard|JJ that|WDT allows|VBZ test|NN periods|NNS of|IN up|IN to|TO five|CD fiscal|JJ years|NNS for|IN the|DT purpose|NN of|IN determining|VBG breakeven|NN for|IN newly|RB introduced|VBN postal|JJ services|NNS .|. 

The|DT Commission|NNP adopted|VBD these|DT four|CD sets|NNS of|IN rules|NNS in|IN 1996|CD ,|, to|TO be|VB effective|JJ for|IN a|DT period|NN of|IN five|CD years|NNS .|. 
In|IN light|NN of|IN their|PRP$ apparent|JJ workability|NN in|IN several|JJ Commission|NNP proceedings|NNS and|CC their|PRP$ continuing|VBG usefulness|NN for|IN affording|VBG procedural|JJ flexibility|NN to|TO the|DT 
9|CD 39|CD C.F.R.|NN §|NN §|NN 3001.69|CD -|: 69|CD c|SYM .|. 10|CD 39|CD C.F.R.|NN §|NN §|NN 3001.181|CD -|: .182|CD .|. 
Postal|NNP Service|NNP ,|, the|DT Commission|NNP extended|VBD their|PRP$ application|NN for|IN an|DT additional|JJ five-year|JJ period|NN in|IN a|DT recent|JJ rulemaking|VBG .11|CD 

Conclusion|NNP :|: Specialized|NNP Postal|NNP Rate|NNP Commission|NNP rules|NNS of|IN procedure|NN are|VBP currently|RB available|JJ for|IN use|NN by|IN the|DT Postal|NNP Service|NNP to|TO provide|VB expeditious|JJ consideration|NN of|IN proposed|VBN service|NN innovations|NNS in|IN a|DT manner|NN consistent|JJ with|IN the|DT due|JJ process|NN rights|NNS of|IN all|DT interested|JJ persons|NNS .|. 

11|CD Docket|NNP No.|NN RM|NNP 2001|CD -|: 3|CD ,|, Order|NNP No.|NN 1322|CD ,|, 66|CD Fed|NNP .|. Reg|NNP .|. 54436|CD (|( 2001|CD )|) .|. 
IV|NNP .|. POSTAL|NNP SERVICE|NNP AUTHORITY|NNP TO|TO ENTER|NNP INTO|NNP NEGOTIATED|NNP RATE|NNP AND|CC SERVICE|NNP AGREEMENTS|NNP WITH|IN INDIVIDUAL|NNP CUSTOMERS|NNP OR|NNP GROUPS|NNP OF|IN CUSTOMERS|NNP TO|TO PROVIDE|NNP SERVICES|NNS 

For|IN a|DT number|NN of|IN years|NNS ,|, some|DT mailers|NNS have|VBP pursued|VBN the|DT idea|NN of|IN establishing|VBG customized|VBN postal|JJ rates|NNS and|CC /|NN or|CC terms|NNS of|IN service|NN through|IN negotiation|NN with|IN the|DT Postal|NNP Service|NNP .|. 
Depending|VBG on|IN their|PRP$ respective|JJ objectives|NNS and|CC features|NNS ,|, contractual|JJ arrangements|NNS of|IN this|DT kind|NN have|VBP been|VBN labeled|VBN "|'' contract|NN rates|NNS ,|, "|'' "|'' negotiated|VBN service|NN agreements|NNS ,|, "|'' or|CC more|RBR recently|RB ,|, "|'' niche|NN classifications|NNS .|. "|'' 
In|IN addressing|VBG the|DT consistency|NN of|IN these|DT various|JJ approaches|NNS with|IN current|JJ law|NN ,|, it|PRP is|VBZ important|JJ to|TO identify|VB and|CC consider|VB all|DT of|IN their|PRP$ characteristics|NNS .|. 
For|IN example|NN ,|, the|DT legality|NN of|IN an|DT agreement|NN may|MD be|VB dependent|JJ on|IN whether|IN the|DT contract|NN is|VBZ agreed|VBN upon|IN and|CC performed|VBN without|IN any|DT regulatory|JJ scrutiny|NN ,|, or|CC instead|RB submitted|VBN for|IN some|DT form|NN of|IN review|NN by|IN the|DT Postal|NNP Rate|NNP Commission|NNP prior|RB to|TO its|PRP$ effectiveness|NN .|. 

A.|NN Statutory|NNP Bases|NNP of|IN Potential|JJ Authority|NNP 
No|DT provision|NN in|IN existing|VBG law|NN explicitly|RB authorizes|VBZ or|CC prohibits|VBZ the|DT Postal|NNP Service|NNP from|IN entering|VBG into|IN rate|NN or|CC service|NN agreements|NNS with|IN mail|NN users|NNS .|. 
Section|NN 401|CD (|( 3|CD )|) of|IN Title|NNP 39|CD generally|RB empowers|VBZ the|DT Service|NNP "|'' to|TO enter|VB into|IN and|CC perform|VB contracts|NNS ,|, "|'' and|CC there|EX is|VBZ no|DT prohibition|NN elsewhere|RB against|IN the|DT Postal|NNP Service|NNP and|CC mail|NN users|NNS negotiating|VBG and|CC reaching|VBG consensus|NN as|IN to|TO how|WRB rates|NNS or|CC conditions|NNS of|IN service|NN should|MD be|VB changed|VBN .|. 
However|RB ,|, other|JJ provisions|NNS in|IN Title|NNP 39|CD cast|NN into|IN doubt|NN the|DT conclusion|NN that|IN the|DT Service|NNP 's|POS authority|NN under|IN §|NN 401|CD (|( 3|CD )|) is|VBZ sufficiently|RB broad|JJ to|TO encompass|VB changes|NNS in|IN rates|NNS or|CC mail|NN classifications|NNS by|IN agreement|NN alone|RB .|. 

The|DT obstacles|NNS to|TO this|DT conclusion|NN are|VBP both|DT procedural|JJ and|CC substantive|JJ .|. 
From|IN a|DT procedural|JJ perspective|NN ,|, the|DT legal|JJ soundness|NN of|IN rate|NN or|CC mail|NN classification|NN changes|NNS by|IN contract|NN alone|RB is|VBZ doubtful|JJ because|IN the|DT only|RB means|NNS of|IN making|VBG such|JJ changes|NNS recognized|VBN in|IN the|DT Reorganization|NNP Act|NNP are|VBP the|DT procedures|NNS prescribed|VBN in|IN Chapter|NN 36|CD of|IN Title|NNP 39|CD .|. 
These|DT provisions|NNS require|VBP that|DT rate|NN or|CC mail|NN classification|NN changes|NNS desired|VBN by|IN the|DT Postal|NNP Service|NNP must|MD be|VB filed|VBN as|IN a|DT request|NN with|IN the|DT Postal|NNP Rate|NNP Commission|NNP ,|, allowing|VBG for|IN public|JJ scrutiny|NN and|CC deliberations|NNS by|IN the|DT Commission|NNP and|CC the|DT Governors|NNS of|IN the|DT Postal|NNP Service|NNP .|. 

Failure|NN to|TO abide|VB by|IN the|DT procedural|JJ requirements|NNS of|IN Chapter|NN 36|CD has|VBZ been|VBN recognized|VBN as|IN a|DT sufficient|JJ legal|JJ basis|NN for|IN voiding|VBG the|DT intended|JJ change|NN .12|CD 

Negotiated|NNP rate|NN or|CC service|NN changes|NNS also|RB may|MD run|VB afoul|NN of|IN the|DT substantive|JJ standards|NNS prescribed|VBN for|IN rates|NNS and|CC mail|NN classifications|NNS in|IN the|DT Reorganization|NNP Act|NNP .|. Section|NN 403|CD (|( c|SYM )|) of|IN Title|NNP 39|CD directs|VBZ that|IN :|: 

In|IN providing|VBG services|NNS and|CC in|IN establishing|VBG classifications|NNS ,|, rates|NNS ,|, and|CC fees|NNS under|IN this|DT title|NN ,|, the|DT Postal|NNP Service|NNP shall|MD not|RB ,|, except|IN as|RB specifically|RB authorized|VBD in|IN this|DT title|NN ,|, make|VBP any|DT undue|JJ or|CC unreasonable|JJ discrimination|NN among|IN users|NNS of|IN the|DT mails|NNS ,|, nor|CC shall|MD it|PRP grant|VB any|DT undue|JJ or|CC unreasonable|JJ preferences|NNS to|TO any|DT such|JJ user|NN .|. 

Sections|NNP 3622|CD and|CC 3623|CD similarly|RB specify|VB fairness|NN and|CC equity|NN ,|, together|RB with|IN other|JJ criteria|NNS ,|, as|IN considerations|NNS to|TO be|VB observed|VBN in|IN making|VBG rate|NN and|CC mail|NN classification|NN changes|NNS .|. 
Without|IN public|JJ scrutiny|NN and|CC review|NN of|IN the|DT terms|NNS of|IN a|DT given|JJ rate|NN or|CC service|NN agreement|NN between|IN the|DT Postal|NNP Service|NNP and|CC a|DT customer|NN ,|, there|EX could|MD be|VB no|DT assurance|NN that|IN these|DT substantive|JJ criteria|NNS would|MD be|VB satisfied|VBN .|. 

However|RB ,|, assuming|VBG the|DT procedural|JJ requirements|NNS of|IN Chapter|NN 36|CD are|VBP met|VBN ,|, changes|NNS negotiated|VBN by|IN the|DT Postal|NNP Service|NNP and|CC a|DT mail|NN user|NN for|IN their|PRP$ mutual|JJ benefit|NN may|MD merit|VB recommendation|NN under|IN the|DT applicable|JJ statutory|JJ standards|NNS .|. 
Section|NN 3623|CD (|( c|SYM )|) directs|VBZ the|DT Commission|NNP to|TO consider|VB "|'' the|DT desirability|NN and|CC justification|NN for|IN special|JJ classifications|NNS and|CC services|NNS of|IN mail|NN "|'' [|NN §|NN 3623|CD (|( c|SYM )|) (|( 2|CD )|) ]|NN and|CC "|'' the|DT desirability|NN of|IN special|JJ classifications|NNS from|IN the|DT point|NN of|IN view|NN of|IN both|DT the|DT user|NN and|CC of|IN the|DT Postal|NNP Service|NNP "|'' [|NN §|NN 3623|CD (|( c|SYM )|) (|( 5|CD )|) ]|NN .|. 
Regarding|VBG rates|NNS ,|, §|NN 3622|CD (|( b|SYM )|) (|( 6|CD )|) establishes|VBZ "|'' the|DT degree|NN of|IN preparation|NN of|IN mail|NN for|IN delivery|NN into|IN the|DT postal|JJ system|NN performed|VBN by|IN the|DT mailer|NN and|CC its|PRP$ effect|NN upon|IN reducing|VBG costs|NNS to|TO the|DT Postal|NNP Service|NNP "|'' as|IN a|DT factor|NN to|TO be|VB considered|VBN in|IN connection|NN with|IN a|DT proposed|JJ change|NN .|. 
In|IN combination|NN with|IN other|JJ factors|NNS and|CC the|DT policies|NNS of|IN the|DT Reorganization|NNP Act|NNP ,|, these|DT 
12|CD United|NNP Parcel|NNP Service|NNP v.|NN U. S.|NNP Postal|NNP Service|NNP ,|, 455|CD F.|NN Supp|NNP .|. 857|CD (|( E.D.|NN Pa|NNP .|. 1978|CD )|) ,|, affirmed|VBD ,|, 604|CD F|NN .2|CD d|SYM 1370|CD (|( 3|CD d|SYM Cir|NNP .|. 1979|CD )|) ,|, cert|NN .|. denied|VBD ,|, 446|CD U.S.|NNP 957|CD (|( 1980|CD )|) .|. 
considerations|NNS could|MD support|VB recommendation|NN of|IN rate|NN and|CC classification|NN changes|NNS tailored|VBN to|TO the|DT capabilities|NNS and|CC needs|NNS of|IN particular|JJ mailers|NNS .|. 

Conclusion|NNP :|: Rate|NNP and|CC service|NN agreements|NNS negotiated|VBN by|IN the|DT Postal|NNP Service|NNP and|CC mail|NN users|NNS are|VBP permissible|JJ under|IN current|JJ law|NN if|IN the|DT procedural|JJ and|CC substantive|JJ requirements|NNS of|IN the|DT Postal|NNP Reorganization|NNP Act|NNP are|VBP satisfied|VBN .|. 

B.|NN Problematical|NNP "|'' Contract|NN Rates|NNS "|'' In|IN a|DT rulemaking|VBG proceeding|VBG conducted|VBN in|IN the|DT late|JJ 1980s|NN at|IN the|DT request|NN of|IN a|DT mailer|NN ,|, the|DT Commission|NNP addressed|VBD the|DT question|NN of|IN the|DT Postal|NNP Service|NNP 's|POS authority|NN to|TO negotiate|VB rate|NN changes|NNS in|IN the|DT form|NN of|IN a|DT proposal|NN to|TO recognize|VB "|'' contract|NN rates|NNS .|. "|'' 
After|IN considering|VBG comments|NNS of|IN the|DT Postal|NNP Service|NNP and|CC other|JJ participants|NNS ,|, the|DT Commission|NNP found|VBD the|DT proposal|NN problematical|JJ ,|, and|CC declined|VBD to|TO pursue|VB it|PRP .|. 

The|DT initial|JJ proposal|NN ,|, considered|VBN in|IN Docket|NNP No.|NN RM|NNP 89|CD -|: 5|CD ,|, included|VBD two|CD variants|NNS :|: 

1|CD .|. The|DT Commission|NNP might|MD ,|, after|IN considering|VBG cost|NN and|CC other|JJ relevant|JJ evidence|NN ,|, establish|VB a|DT range|NN of|IN permissible|JJ rates|NNS for|IN particular|JJ subclasses|NNS ,|, with|IN the|DT Postal|NNP Service|NNP and|CC individual|JJ mailers|NNS free|JJ thereafter|RB to|TO negotiate|VB rates|NNS within|IN this|DT range|NN ;|: or|CC 
2|CD .|. The|DT Postal|NNP Service|NNP and|CC one|CD or|CC more|JJR mailers|NNS would|MD negotiate|VB a|DT rate|NN and|CC service|NN package|NN which|WDT would|MD then|RB (|( i|NNP )|) be|VB submitted|VBN to|TO the|DT Commission|NNP for|IN a|DT review|NN ,|, and|CC (|( ii|NN )|) thereafter|RB be|VB available|JJ on|IN the|DT same|JJ terms|NNS to|TO all|DT potential|JJ users|NNS .|. 
The|DT Commission|NNP solicited|VBD two|CD rounds|NNS of|IN comments|NNS on|IN the|DT proposal|NN from|IN interested|JJ parties|NNS .|. 
The|DT proponent|NN and|CC one|CD other|JJ mailer|NN took|VBD the|DT position|NN that|IN the|DT Postal|NNP Service|NNP is|VBZ authorized|VBN to|TO enter|VB into|IN such|JJ contracts|NNS ,|, provided|VBD the|DT procedural|JJ requirement|NN of|IN review|NN under|IN Chapter|NN 36|CD is|VBZ observed|VBN .|. 
Other|JJ commenters-including|JJ the|DT Commission|NNP 's|POS Office|NNP of|IN Consumer|NNP Advocate-expressed|NNP doubts|NNS regarding|VBG the|DT legal|JJ soundness|NN of|IN one|CD or|CC both|DT of|IN the|DT proposed|JJ variants|NNS of|IN such|JJ agreements|NNS .|. 
The|DT Postal|NNP Service|NNP commented|VBD that|IN ,|, in|IN its|PRP$ view|NN ,|, legal|JJ constraints|NNS would|MD not|RB preclude|VB a|DT contract|NN mechanism|NN in|IN principle|NN ,|, but|CC that|IN no|DT such|JJ arrangement|NN would|MD be|VB permissible|JJ without|IN the|DT Commission|NNP 's|POS participation|NN in|IN accordance|NN with|IN 39|CD U.S.C.|NNP §|NN §|NN 3622|CD through|IN 3625|CD .|. 

Upon|IN consideration|NN of|IN the|DT initial|JJ comments|NNS it|PRP received|VBD ,|, the|DT Commission|NNP declined|VBD to|TO pursue|VB the|DT contract|NN rate|NN proposal|NN ,|, but|CC solicited|VBD further|JJ comments|NNS on|IN several|JJ broad|JJ issues|NNS concerning|VBG possible|JJ changes|NNS in|IN the|DT mail|NN classification|NN system|NN .|. 
The|DT Commission|NNP explained|VBD that|IN its|PRP$ reluctance|NN to|TO pursue|VB the|DT concept|NN of|IN contract|NN rates|NNS was|VBD based|VBN on|IN substantial|JJ uncertainty|NN regarding|VBG the|DT legal|JJ sufficiency|NN of|IN examining|VBG agreed-upon|JJ rates|NNS after|IN the|DT fact|NN ,|, rather|RB than|IN in|IN a|DT prior|JJ review|NN .|. 
It|PRP also|RB raised|VBD the|DT potential|JJ problems|NNS of|IN unreasonable|JJ discrimination|NN that|IN such|JJ contracts|NNS might|MD cause|VB ,|, in|IN contravention|NN of|IN 39|CD 
U.S.C.|NNP §|NN 403|CD (|( c|SYM )|) ,|, and|CC the|DT preservation|NN of|IN fair|JJ contributions|NNS to|TO the|DT Postal|NNP Service|NNP 's|POS institutional|JJ costs|NNS by|IN mail|NN volumes|NNS .13|CD 
Such|JJ problems|NNS might|MD well|RB arise|VB if|IN the|DT Service|NNP were|VBD to|TO negotiate|VB "|'' discounted|VBN "|'' rates-unaccompanied|JJ by|IN a|DT change|NN in|IN service|NN conditions|NNS that|WDT provided|VBD cost|NN or|CC revenue|NN justification|NN .|. 

Conclusion|NNP :|: Negotiated|NNP rates-unaccompanied|JJ by|IN a|DT change|NN in|IN service|NN conditions|NNS that|WDT provides|VBZ cost|VBN justification-are|JJ a|DT problematical|JJ approach|NN to|TO introducing|VBG additional|JJ flexibility|NN into|IN Postal|NNP Service|NNP business|NN practices|NNS .|. 

C.|NN Negotiated|NNP Service|NNP Agreements|NNP and|CC Specialized|NNP "|'' Niche|NNP Classifications|NNP "|'' Following|VBG publication|NN of|IN the|DT report|NN of|IN the|DT joint|JJ Postal|NNP Service-|NNP Postal|NNP Rate|NNP Commission|NNP task|NN force|NN on|IN ratemaking|VBG ,|, the|DT Postal|NNP Service|NNP petitioned|VBD the|DT Commission|NNP to|TO adopt|VB rules|NNS to|TO implement|VB some|DT of|IN the|DT report|NN 's|POS recommendations|NNS .|. 
One|CD recommendation|NN included|VBN in|IN the|DT Service|NNP 's|POS petition|NN was|VBD adoption|NN of|IN Commission|NNP rules|NNS for|IN reviewing|VBG on|IN an|DT expedited|JJ basis|NN "|'' service|NN agreements|NNS with|IN postal|JJ customers|NNS ,|, varying|VBG from|IN the|DT general|JJ rate|NN and|CC classifications|NNS schedules|NNS in|IN ways|NNS which|WDT add|VBP value|NN both|DT for|IN the|DT customer|NN and|CC for|IN the|DT postal|JJ system|NN as|IN a|DT whole|NN .|. "|'' 
14|CD 
The|DT proposal|NN in|IN the|DT Postal|NNP Service|NNP 's|POS petition|NN would|MD have|VB established|VBN Negotiated|NNP Service|NNP Agreements|NNP as|IN a|DT new|JJ form|NN of|IN mail|NN classification|NN ,|, with|IN individual|JJ agreements|NNS to|TO be|VB reviewed|VBN by|IN the|DT Commission|NNP within|IN 60|CD days|NNS .|. 
In|IN the|DT Commission|NNP 's|POS Notice|NNP of|IN Proposed|NNP Rulemaking|NNP ,|, it|PRP deferred|VBN consideration|NN of|IN the|DT NSA|NNP proposal|NN ,|, citing|VBG legal|JJ uncertainty|NN regarding|VBG the|DT consistency|NN of|IN negotiated|VBN rates|NNS with|IN the|DT Reorganization|NNP Act|NNP 's|POS 

13|CD Docket|NNP No.|NN RM|NNP 89|CD -|: 5|CD ,|, Further|RB Invitation|NNP for|IN Comments|NNS ,|, 54|CD Fed|NNP .|. Reg|NNP .|. 47223|CD (|( 1989|CD )|) .|. 14|CD Postal|NNP Ratemaking|NNP in|IN a|DT Time|NNP of|IN Change|NNP ,|, supra|NN ,|, at|IN 54|CD .|. 
ratemaking|VBG provisions|NNS .|. 
However|RB ,|, the|DT Commission|NNP also|RB expressed|VBD a|DT general|JJ willingness|NN to|TO address|VB the|DT concept|NN in|IN a|DT subsequent|JJ rulemaking|VBG .|. 

Since|IN then|RB ,|, the|DT Commission|NNP has|VBZ conducted|VBN several|JJ mail|NN classification|NN proceedings|NNS under|IN the|DT other|JJ expedited|VBN procedures|NNS adopted|VBN in|IN that|DT rulemaking|VBG .|. 
These|DT procedures|NNS have|VBP been|VBN shown|VBN to|TO be|VB well|RB suited|VBN to|TO the|DT consideration|NN of|IN "|'' niche|NN classification|NN "|'' proposals|NNS .|. 
Niche|NNP classifications|NNS are|VBP specialized|JJ mail|NN classifications-|NN including|VBG reduced|VBN ,|, but|CC cost-justified|JJ rates|NNS or|CC fees-that|JJ have|VBP been|VBN developed|VBN by|IN the|DT Postal|NNP Service|NNP in|IN direct|JJ consultation|NN with|IN its|PRP$ customers|NNS ,|, to|TO meet|VB the|DT needs|NNS and|CC capabilities|NNS of|IN a|DT mailer|NN or|CC group|NN of|IN mailers|NNS .|. 
For|IN example|NN ,|, the|DT Commission|NNP approved|VBD a|DT two-year|JJ experiment|NN of|IN a|DT program|NN that|WDT enabled|VBD users|NNS of|IN bulk|NN ,|, nonletter-size|JJ Business|NNP Reply|NNP Mail|NNP such|JJ as|IN photofinishers|NNS that|WDT could|MD reliably|RB determine|VB postage|NN and|CC fees|NNS due|JJ ,|, to|TO obtain|VB earlier|JJR access|NN to|TO their|PRP$ mail|NN at|IN revised|VBN fees|NNS .15|CD 
The|DT Commission|NNP subsequently|RB granted|VBD a|DT requested|JJ extension|NN of|IN the|DT experiment|NN ,|, 16|CD and|CC ultimately|RB approved|VBD a|DT request|NN to|TO make|VB the|DT experimental|JJ program|NN a|DT permanent|JJ mail|NN classification|NN .17|CD 
More|RBR recently|RB ,|, in|IN Docket|NNP No.|NN MC|NNP 2001|CD -|: 1|CD ,|, the|DT Commission|NNP recommended|VBD three|CD new|JJ worksharing-based|JJ discounted|VBN Priority|NNP Mail|NNP categories|NNS after|IN negotiating|VBG with|IN mailers|NNS who|WP were|VBD willing|JJ to|TO presort|NN their|PRP$ mail|NN in|IN new|JJ ways|NNS that|WDT could|MD reduce|VB the|DT Postal|NNP Service|NNP 's|POS costs|NNS .18|CD 
Such|JJ "|'' niche|NN classification|NN "|'' proposals|NNS are|VBP essentially|RB Negotiated|NNP Service|NNP Agreements|NNP ,|, without|IN any|DT associated|VBN legal|JJ uncertainties|NNS or|CC additional|JJ administrative|JJ barriers|NNS .|. 

Conclusion|NNP :|: Rate|NNP and|CC service|NN adjustments|NNS agreed|VBD upon|IN by|IN the|DT Postal|NNP Service|NNP and|CC mailers|NNS are|VBP legally|RB authorized|VBN if|IN three|CD conditions|NNS are|VBP satisfied|VBN :|: 

❶|CD The|DT proposal|NN is|VBZ reviewed|VBN in|IN a|DT public|JJ proceeding|NN ,|, as|IN the|DT Reorganization|NNP Act|NNP requires|VBZ ;|: 

❷|CD The|DT agreed-upon|JJ rate|NN and|CC service|NN changes|NNS will|MD work|VB to|TO the|DT mutual|JJ benefit|NN of|IN mail|NN users|NNS and|CC the|DT postal|JJ system|NN as|IN a|DT whole|JJ ;|: and|CC 

15|CD Docket|NNP No.|NN MC|NNP 97|CD -|: 1|CD ,|, Opinion|NNP and|CC Recommended|NNP Decision|NNP ,|, April|NNP 2|CD ,|, 1997|CD .|. 
16|CD Docket|NNP No.|NN MC|NNP 99|CD -|: 1|CD ,|, Opinion|NNP and|CC Recommended|NNP Decision|NNP Approving|NNP Revised|VBN Stipulation|NNP and|CC Agreement|NNP ,|, May|NNP 14|CD ,|, 1998|CD .|. 
17|CD Docket|NNP No.|NN MC|NNP 99|CD -|: 2|CD ,|, Opinion|NNP and|CC Recommended|NNP Decision|NNP Approving|NNP Stipulation|NNP and|CC Agreement|NNP ,|, July|NNP 14|CD ,|, 1999|CD .|. 
18|CD See|VB the|DT description|NN of|IN this|DT proceeding|VBG in|IN the|DT Appendix|NNP .|. 
❸|CD The|DT negotiated|VBN rate-and-service|JJ package|NN is|VBZ made|VBN available|JJ on|IN the|DT same|JJ terms|NNS to|TO other|JJ potential|JJ users|NNS willing|JJ to|TO meet|VB the|DT same|JJ conditions|NNS of|IN service|NN .|. 

Examples|NNS of|IN "|'' niche|NN classification|NN "|'' proposals|NNS recommended|VBD in|IN recent|JJ Commission|NNP proceedings|NNS ,|, and|CC Postal|NNP Service|NNP product|NN innovations|NNS considered|VBN in|IN other|JJ cases|NNS ,|, are|VBP described|VBN in|IN the|DT Appendix|NNP to|TO this|DT report|NN .|. 

Report|NNP To|TO The|DT Congress|NNP Appendix|NNP Feb|NNP .|. 11|CD ,|, 2002|CD Page|NNP 1|CD of|IN 2|CD 
Postal|NNP Service|NNP Product|NNP Innovations|NNP and|CC Special-|NNP Purpose|NNP Mail|NNP Classification|NNP Changes|NNS Reviewed|NNP by|IN the|DT Postal|NNP Rate|NNP Commission|NNP Since|IN January|NNP 1|CD ,|, 2000|CD 
Docket|NNP No.|NN MC|NNP 2001|CD -|: 1|CD -|: Experimental|NNP Presorted|NNP Priority|NNP Mail|NNP Rate|NNP Categories|NNP •|NN Nature|NNP of|IN service|NN or|CC change|NN :|: Experimental|NNP trial|NN of|IN three|CD new|JJ presorted|JJ rate|NN categories|NNS of|IN Priority|NNP Mail|NNP .|. 
•|NN Target|NNP users|NNS :|: Mailers|NNP who|WP can|MD meet|VB minimum|JJ quantity|NN ,|, mail|NN preparation|NN and|CC containerization|NN requirements|NNS for|IN presorting|VBG their|PRP$ Priority|NNP Mail|NNP shipments|NNS .|. 
•|NN Rate|NNP (|( s|VBZ )|) and|CC justification|NN :|: Three|CD levels|NNS of|IN presort|NN discounts|NNS based|VBN on|IN processing|NN costs|NNS bypassed|JJ because|IN of|IN worksharing|VBG by|IN mailers|NNS .|. 
•|NN Procedural|NNP history|NN :|: Request|NNP filed|VBN by|IN Postal|NNP Service|NNP on|IN March|NNP 7|CD ,|, 2001|CD .|. 
Settlement|NNP agreement|NN among|IN parties|NNS filed|VBN on|IN May|NNP 17|CD ,|, 2001|CD .|. 
PRC|NNP decision|NN approving|VBG settlement|NN agreement|NN transmitted|VBD to|TO Postal|NNP Service|NNP Governors|NNS on|IN May|NNP 25|CD ,|, 2001|CD .|. 
Governors|NNS approved|VBD PRC|NNP decision|NN on|IN June|NNP 4|CD ,|, 2001|CD .|. 
Docket|NNP No.|NN MC|NNP 2000|CD -|: 1|CD -|: Experimental|NNP "|'' Ride-|NNP Along|IN "|'' Classification|NNP Change|NNP for|IN Periodicals|NNP •|NN Nature|NNP of|IN service|NN or|CC change|NN :|: Experiment|NNP allowing|VBG one|CD piece|NN of|IN advertising|NN matter|NN to|TO "|'' ride-along|JJ "|'' in|IN a|DT Periodicals|NNP publication|NN for|IN a|DT flat|JJ additional|JJ ten-cent|JJ rate|NN .|. 
•|NN Target|NNP users|NNS :|: Publishers|NNPS who|WP wish|VBP to|TO include|VB innovative|JJ advertisements|NNS in|IN their|PRP$ periodicals|NNS at|IN a|DT more|RBR affordable|JJ rate|NN than|IN Standard|NNP A|DT postage|NN .|. 
•|NN Rate|NNP (|( s|VBZ )|) and|CC justification|NN :|: Flat|JJ ten-cent|JJ rate|NN available|JJ only|RB for|IN "|'' ride-along|JJ "|'' pieces|NNS that|WDT do|VBP not|RB cause|VB any|DT significant|JJ additional|JJ mail|NN processing|NN or|CC delivery|NN costs|NNS .|. 
•|NN Procedural|NNP history|NN :|: Request|NNP filed|VBN by|IN Postal|NNP Service|NNP on|IN September|NNP 27|CD ,|, 1999|CD .|. 
Settlement|NNP agreement|NN among|IN parties|NNS filed|VBN on|IN December|NNP 20|CD ,|, 1999|CD .|. 
PRC|NNP decision|NN approving|VBG settlement|NN agreement|NN transmitted|VBD to|TO Postal|NNP Service|NNP Governors|NNS on|IN February|NNP 3|CD ,|, 2000|CD .|. 
Governors|NNS approved|VBD PRC|NNP decision|NN on|IN February|NNP 8|CD ,|, 2000|CD .|. 
➨|NN Update|NNP :|: Postal|NNP Service|NNP request|NN for|IN permanent|JJ authority|NN filed|VBD September|NNP 24|CD ,|, 2001|CD in|IN Docket|NNP No.|NN R|NN 2001|CD -|: 1|CD .|. 
Action|NNP by|IN Commission|NNP is|VBZ pending|VBG .|. 
Postal|NNP Service|NNP Request|NNP for|IN extension|NN of|IN experiment|NN filed|VBN in|IN Docket|NNP No.|NN 
MC|NNP 2001|CD -|: 3|CD on|IN September|NNP 28|CD ,|, 2001|CD .|. 
PRC|NNP decision|NN approving|VBG request|NN transmitted|VBD to|TO Postal|NNP Service|NNP Governors|NNS on|IN January|NNP 11|CD ,|, 2002|CD .|. 

Report|NNP To|TO The|DT Congress|NNP Appendix|NNP Feb|NNP .|. 11|CD ,|, 2002|CD Page|NNP 2|CD of|IN 2|CD 
Docket|NNP No.|NN MC|NNP 2000|CD -|: 2|CD -|: Mailing|NNP Online|NNP Experiment|NNP •|NN Nature|NNP of|IN service|NN or|CC change|NN :|: Experimental|NNP service|NN enabling|VBG computer|NN users|NNS to|TO transmit|VB documents|NNS in|IN electronic|JJ form|NN to|TO Postal|NNP Service|NNP for|IN printing|NN ,|, processing|NN ,|, and|CC delivery|NN as|IN Express|NNP Mail|NNP ,|, First-|NNP Class|NNP Mail|NNP or|CC Standard|NNP A|DT Mail|NNP .|. 
•|NN Target|NNP users|NNS :|: Single-piece|NNP mailers|NNS and|CC small|JJ office|NN /|NN home|NN office|NN (|( SOHO|NNP )|) operators|NNS who|WP have|VBP difficulty|NN taking|VBG advantage|NN of|IN traditional|JJ mail|NN service|NN providers|NNS .|. 
•|NN Rate|NNP (|( s|VBZ )|) and|CC justification|NN :|: Applicable|NNP bulk|NN mailing|NN rate|NN plus|CC fee|NN to|TO recover|VB costs|NNS of|IN printing|NN ,|, technological|JJ resources|NNS ,|, advertising|NN and|CC other|JJ program-related|JJ expenses|NNS .|. 
•|NN Procedural|NNP history|NN :|: Market|NNP test|NN of|IN same|JJ service|NN approved|VBN by|IN PRC|NNP in|IN Docket|NNP No.|NN MC|NNP 98|CD -|: 1|CD .|. 
Request|NNP for|IN three-year|JJ experiment|NN filed|VBN by|IN Postal|NNP Service|NNP on|IN November|NNP 16|CD ,|, 1999|CD .|. 
Hearings|NNS held|VBD December|NNP ,|, 1999|CD through|IN February|NNP ,|, 2000|CD .|. 
PRC|NNP decision|NN approving|VBG proposal|NN ,|, with|IN recommended|JJ fee|NN modifications|NNS ,|, on|IN June|NNP 21|CD ,|, 2000|CD .|. 
Governors|NNS approved|VBD PRC|NNP decision|NN on|IN August|NNP 7|CD ,|, 2000|CD .|. 
Docket|NNP No.|NN MC|NNP 2001|CD -|: 2|CD -|: Experimental|NNP Seasonal|NNP Delivery|NN Confirmation|NNP Fee|NN •|NN Nature|NNP of|IN service|NN or|CC change|NN :|: Experiment|NNP to|TO provide|VB manual|JJ delivery|NN confirmation|NN without|IN charge|NN to|TO retail|VB Priority|NNP Mail|NNP users|NNS during|IN two|CD weeks|NNS before|IN the|DT peak|NN of|IN the|DT holiday|NN mailing|NN season|NN .|. 
•|NN Target|NNP users|NNS :|: Small|JJ volume|NN mailers|NNS that|WDT might|MD be|VB made|VBN more|RBR inclined|JJ to|TO mail|VB before|IN the|DT holiday|NN peak|NN ,|, and|CC that|IN also|RB might|MD ,|, as|IN a|DT result|NN of|IN the|DT test|NN ,|, increase|NN their|PRP$ purchases|NNS of|IN delivery|NN confirmation|NN service|NN in|IN the|DT future|NN .|. 
•|NN Rate|NNP (|( s|VBZ )|) and|CC justification|NN :|: Delivery|NN confirmation|NN to|TO be|VB available|JJ at|IN no|DT charge|NN to|TO retail|VB Priority|NNP Mail|NNP users|NNS during|IN the|DT early|JJ stages|NNS of|IN the|DT holiday|NN season|NN .|. 
•|NN Procedural|NNP History|NN :|: Request|NNP Filed|NNP by|IN Postal|NNP Service|NNP September|NNP 20|CD ,|, 2001|CD .|. 
Postal|NNP Service|NNP withdrew|VBD request|NN on|IN November|NNP 5|CD ,|, 2001|CD because|IN the|DT disruption|NN of|IN other|JJ events|NNS made|VBD conducting|VBG the|DT experiment|NN inadvisable|JJ .|. 
